The Platinum Asset Management Limited (ASX: PTM) share price is down 4% to $4.29 today after the fundie told investors not to expect much in the way of performance fees for the 6 months ending December 31 2019. As at October 31 2019 funds under management stood at $24.6 billion, which was 0.7% down on June 30, 2019.
Total funds under management stood at $22.7 billion as at the end of fiscal 2017 so it has climbed a little bit, but when you factor in that equity markets have been generally strong over the period the result is nothing to write home about.
Dividends in fiscal 2019 totalled 27 cents per share, versus 32 cents per share in the prior year with this year's result looking likely to be flat. Platinum pays out most of its net profit in dividends as funds management is a capital light business model that does not require much reinvestment into the business.
Platinum shares are down around 34% over the past 5 years as it struggles to meaningfully grow FUM. Investment performance has also been average, with it being a strong driver of overall FUM levels.
In the asset management space Macquarie Group Ltd (ASX: MQG) and Magellan Financial Group Ltd (ASX: MFG) could be better long-term growth bets.
